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 Many of you are already aware of what re-listing is and the effect it can have on the data and perceptions regarding the real estate market. Here are some links to articles I have previously written on the subject:
As I mention elsewhere, in October of 2006, the MLS service that I work with and that services the area from San Francisco down past Monterey California changed its rules regarding re-listing. I went back to see if it has made a difference.
So did it? Well, first lets talk a bit about who "they" are and what they did.
The "they" is REInfolink. These are the folks that control the MLS system that covers the area from just south of San Francisco down past Monterey. Despite popular opinion (and what 60 minutes seems to think is the case), there is no single MLS system. It is a whole bunch of smaller databases.
Now, REInfolinks new policy was that a listing will always "remember" old listing information UNLESS a home is off the market for 30 days or more before it is listed again. So what this meant was that as long at 30 days did not pass between listings, the data in the most current listing would show the correct number of days on the market and the correct original listing price.
My concern at the time, which proved to be correct, was that numbers would suddenly look a whole lot worse not because the market changed but because the way the numbers were reported would change. The numbers did skew in the way I predicted and the pundits did jump up and down. However, since the pundits were jumping up and down anyway, any effects the new numbers had were sort of lost in the panic.
Now re-listing was being used in well over 50% of the transactions I reviewed back before this new policy came into place. As I predicted, this new policy did in fact put an end to re-listing (in my MLS anyway) as a strong skew to the data being created each month. However, it did NOT end the problem.
As of April 2007, I am seeing somewhere in the area of 10% of all homes listed still using re-listing. The amount it is being used seems to change depending on what area you are looking in and what price range the homes are in, but it is still being used to one degree or another. Since homes are tending to stay on the market much longer these days, there is a higher likelyhood that waiting those 30 days to re-list will look like a good idea. So I suspect that current market influences are encouraging some to use re-listing now.
For instance, I am seeing re-listing being used more with higher end homes now. One clear reason for this is that homes at the higher end are just not selling. Many of these homes are for sale by owners that bought them in the last 2 or 3 years. In those cases, they cannot hope to sell the home for what they paid for it. Because these folks need to do all they can, they are perfectly willing to take their home off the market for 30 days to "clear the air" so to speak of the fact that their home has been on the market for 8 months.
In our current market, I see re-listing in my area as less of a concern for what it does to the statistics. That effect has been greatly reduced by the new policies. My primary interest in exploring this now is so that buyers can get the "real" story on properties that they are considering buying. Make sure and ask your agent to look into the listing history of any properties your interested in. I know that I would like to know the fact that a home has been listed for over a year if I am considering writing up an offer.
Now remember, if you are a buyer elsewhere in the country or in California, there is a good chance the bad old days of "Re-Listing" are alive and well. While my MLS system has implemented policies to fight re-listing, most have not done this.
For those of you living in areas where re-listing is still allowed, the examples I gave in the linked articles at the beginning of this article can still happen in your area. That can mean that much of what you believe about your real estate market is not accurate.
Your best defense is know about the problem and having the agent your working with look a little deeper to find out if re-listing is being used with any properties you are interested in.
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